Granulocytes are recognized by the presence of granules, including primary (azurophilic) and secondary types. Each granule type contains distinct and characteristic families of enzymes. We have screened a murine bone marrow cDNA library to obtain a series of sequences corresponding to mRNAs which are both myeloid-specific and appear to be expressed only in immature bone marrow cells. A 1,160 bp sequence (B9) has been isolated, which shows restricted expression in murine bone marrow, with the highest levels in cultures enriched for promyelocytes. Translation yields a single open reading frame of 167 amino acids and a calculated MW of 19.33 kd. A single potential N-glycosylation site is present. Evaluation of the amino terminal sequence shows 2 polar amino acids flanking a hydrophobic region, suggesting a signal sequence and the possibility of post-translational modification. An extensive search of the protein data base reveals 30% identity over 90 amino acids with porcine cathelin, a cystatin-like cysteine proteinase inhibitor. This sequence identity includes conservation of the 4 cysteine residues noted in all members of the cystatin superfamily. In an attempt to further characterize this novel sequence, a polyclonal antiserum was prepared by immunization with a 20 amino acid synthetic peptide corresponding to a unique portion of the carboxy terminus. Immunoelectron microscopy localized B9 to neutrophilic granules. We have identified a novel myeloid-specific granule protein related to porcine cathelin, but showing important structural differences. This may represent the first isolated member of a new cystatin family. More importantly, the small size of the B9 gene and its tight pattern of early expression make B9 an excellent reporter molecule for the study of new factors important in myeloid differentiation.